Apple cuts iPod Touch prices by up to 25%

Apple today cut prices of its iPod Touch as sales of that device and others in the iPod lineup have plummeted over the past year.

The iPod Touch, which resembles an iPhone but lacks the hardware to make or take cellular phone calls, now starts at $199 for a 16GB model, 13% less than yesterday. Other models were repriced at $249 (32GB of storage) and $299 (64GB), reductions of 17% and 25%, respectively.

Apple added a rear-facing 5-megapixel camera to the low-end iPod Touch, and expanded the color selection of the 16GB model to match the hues previously available only on the higher-priced devices.

Sales of the iPod line -- once a major revenue generator -- have been falling for years. In the March quarter, the most recently reported, Apple sold 2.7 million iPods, a decrease of 51% from the same period the year before.

Revenue from iPod sales totaled $461 million, off 52% from the first calendar quarter of 2013, and accounted for just 1% of Apple's $45.6 billion in the period. The year before, the iPod generated 2.2% of all Apple sales.

As recently as the first quarter of 2011, the iPod line accounted for nearly 13% of Apple's revenue.

Some analysts have urged Apple to ditch the iPod because it's a no-growth business, but Apple has not hinted that it would follow that advice. It has, however, acknowledged the shrinking sales. "I think all of us have known for some time that iPod is a declining business," said CEO Tim Cook in January during an earnings call with Wall Street.

:story: Computerworld